New pension rules query

barnsleynanna

noh wrote: »

One other factor that the OP hasn't considered is that static caravans have a limited lifespan and most parks have conditions stating that caravans sited there must be under a certain age. Within the next 10 to 15 years they will be looking at needing to purchase a new or refurbished caravan.

Our mobile home site has no policy regarding the age of our van. Some neighbour's vans are around 25 years old now and going strong. Another poster mentioned that 'army' son in law would be retiring early. He isn't in the army - he used to be and was finished on medical grounds - he's now self employed. It's my ex son in law who took redundancy from the army a short while ago, with a very large payout, of which my daughter and her children received nothing. She will only benefit from a part of is pension pot at his normal retirement date. She and her partner cannot afford to get onto the property ladder now without our assistance, hence the reason for us wanting to gift them the money earlier, rather than later ...... and I don't like being told I'm bonkers just because I want to help my family !

bristol_pilot

Like many on here, the OP asks for advice....but only if it's what they want to hear. Helping family isn't bonkers, giving away your pension is. If the daughter needs help to get on the housing ladder, why not look at the government's Help to Buy scheme?

atush

you are being given good advice if you can recognize it or not.

It's my ex son in law who took redundancy from the army a short while ago, with a very large payout, of which my daughter and her children received nothing. She will only benefit from a part of is pension pot at his normal retirement date.

this has 2 warnings. One, our daughter already has one failed marriage. Had you done this before, her ex would have had half your dosh. Two, your daughter has half an army pension. how much is it worth on his retirement date and how far from now is it?

No one said not to give her a sum to help to buy. Everyone says to not sell w.o retaining money to live 2 months per year. And to not give away much of your capital but maybe some of the tax free lump sum

Read the replies you got rather than being upset. We only have your best interests at heart.

antenna

In the answers some people forget you will have two old age pensions coming in in the future........as for £145.000 pension pots...well good for you.....
some couples only have 2 old age pensions coming in to live on,and perhaps a bit of social...............give your house away by all means but retain your cash for your older age.

barnsleynanna

atush wrote: »

you are being given good advice if you can recognize it or not.



this has 2 warnings. One, our daughter already has one failed marriage. Had you done this before, her ex would have had half your dosh. Two, your daughter has half an army pension. how much is it worth on his retirement date and how far from now is it?

No one said not to give her a sum to help to buy. Everyone says to not sell w.o retaining money to live 2 months per year. And to not give away much of your capital but maybe some of the tax free lump sum

Read the replies you got rather than being upset. We only have your best interests at heart.

I have read all of the replies, and taken some good information on board. I realise the point about my daughter having one failed marriage, even though I would point out it was none of her doing .. but point well taken.

Could I ask another question instead? Husband's £85K pension pot. He obviously intends to take the 25% tax free lump sum. If, instead of doing what I mentioned earlier and taking the rest with an up front tax hit, will he be able to 'draw down' further amounts each year up to his personal allowance? i.e. £10k per year?, or will his state pension be classed as earnings, thereby reducing the amount?

atush

If you dont want to use your pot to live on the rest of your life, and intend to take it out, then that is the best way to do it.

As you will be saving on tax (and will therefore have more to spend or give away).

Of course, if he wants to go into Drawdown (DD) then his current pension may not allow it. So start looking into a pension to transfer his pot to before April. Remember, that if your do DD over a number of years, you are probably going to want some of it to remain invested for growth.

barnsleynanna

Thank you Atush. We will contact his 3 different pension providers and ask if they do drawdown. If not, we'll look at transferring ... presumably this would have to be done before April 2015? Is his state pension included in his yearly personal allowance? I'm assuming that if it is, with a £10k personal allowance, he won't be able to draw down more than a further £3k per year without paying tax on it (if the anticipated figures of around £148 per week basic state pension are correct. If this is the case, £3k per year isn't much of an amount on drawdown ?????

Another thought .. since I will only be working from home for a few hours per week when husband retires, can I transfer my unused personal allowance to him, allowing him to draw down more? (married man's tax allowance) ?

atush

No you cannot (at this time) transfer your allowance. So if you aren't using yours, any savings not isn isas should be in your name only for tax reasons. If you could, it would be a good idea to work more as you are younger and put this money into a DC pension. You can of course have him take out enough extra pension to contribute to a DC pension for you, which means you will get the tax back. You can put in 2880 a year which becomes 3600 with TR or your yearly income, whichever is higher.

Then, of your OH's 85K, 63750 will be in Drawdown as potentially taxed income with 21250 being his TFlump sum.

That 63K could provide an income per annum at 4%, a sustainable 3825 PA or 319 per month. You take more (even 1.5 times that now as much as you like next year) but it will be subject to basic rate tax.

At least doing it this way means you will not only pay as little tax as possible, but his pension pot is not as likely to suffer depletion and should he die, you could inherit all of it (if you keep it in the pension pot for you to draw on).

greenglide

atush wrote: »

No you cannot (at this time) transfer your allowance. So if you aren't using yours, any savings not isn isas should be in your name only for tax reasons

But you can from next tax year providing the government doesnt do a U turn.

£1000 of your allowance transferable if all goes to plan.

atush

yes, but I wasn't sure that had been out into law, and only saves a few hundred. But would allow him to draw more per year.

If he wanted to draw even more and give it to her for her DC pension then that could save more?